Monday, October 25, 2010

TARP, the Republican Master Plan?

We all hate TARP. Whether you are angry about government spending, capitol hill being too cozy with the big bucks on wall street, the very concept of a bailout, or are just yelling because everyone else is, TARP gives everyone a reason to get upset. It stands for everything against which the populist storm that is the Tea Party rages, and it is probably the only thing that everyone can agree on. Upwards of $80 million dollars have been spent this election year disparaging the bailout bill in some way, with $53 million of that coming from Democrats. The thing is, TARP has performed wonderfully.

Originally expected to cost taxpayers $356 billion, TARP is now on track to come in with a cost of around $30 billion after all is said and done. AIG and Citigroup are expected to buy back their assets and "finish" TARP in the coming year. What TARP did, in a nutshell, was stabilize our economic system when it was on the brink of catastrophic failure while costing us little to nothing. It is a testament to the positive power of the government, and probably prevented unemployment figures in the 20s.

So, why all the hate? In a word, self-righteousness fuels the hate directed towards TARP. It has been portrayed as a bill that highlights the cozy relationship between the rich and Congress, and after all, everyone hates rich people. Some of the outrage is justified. Wall Street got bailed out after using risky and volatile banking practices that brought us to the edge. Americans have every right to be upset about that. But going a step further and denouncing TARP is irresponsible. Government is around to help people engage in whatever pursuit they will, provided it does not hinder that right in others. Had the government let the banks collapse, as many have suggested, we would be looking at a much, much deeper crisis.

I guess my message is, hate the derivatives and the greedy and irresponsible men who relied too heavily on them, not the responsible government program which bailed them out. The thing is, that doesn't make for an especially compelling campaign war cry. "It's all Wall Street's fault!" doesn't get either party votes, while a successful portrayal of a Democrat as cozy with the reviled rich makes for a cutting ad in these populist times.

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